Sen. Chris Van Hollen wants to know what progress the SEC is making investigating letters used to support controversial rules that would impose new requirements on proxy advisory firms and higher thresholds for shareholder proposals.
In a June 25 letter sent to SEC Chairman Jay Clayton, the Democratic senator from Maryland reminded Mr. Clayton that the "apparently fraudulent" letters came up at a December 2019 Senate Banking Committee hearing, where the Mr. Van Hollen said SEC officials "got duped" into approving the rule changes Nov. 5, in part because of letters of support from Main Street investors. Several of those letters have been traced back to people affiliated with an advocacy group, 60 Plus Association, whose members include large corporations.
Mr. Clayton said at the December hearing that the letters were being investigated by the agency's general counsel and inspector general.
"I would also like to know how the SEC intends to account for the fact that the changes it is seeking in the regulation of proxy advisers do not appear to be based on concerns of 'Main Street' investors, as the revelations around the public comments clearly show, but instead emanate from corporate heads and boards that oppose investor oversight or review of their actions and proposals," Mr. Van Hollen said in his letter, asking for an update to the investigation.
"Until the investigation of this orchestrated campaign of fraudulent comment letters is resolved," Mr. Van Hollen wrote, "I urge that the SEC refrain from finalizing" the proposed rule.
